Ripple: Allegations of fraud under submission

• The allegations of fraud against Ripple in the context of the consolidated lawsuits in the US state of California could soon be settled. The motion to dismiss fraud allegations was taken under submission.
  
• However, there has been no movement regarding the allegations of selling XRP as an unregistered security.

There has been some movement in one of the lawsuits against Ripple Labs’ last Friday. As reported by CNF, Ripple has been facing several lawsuits for some time now. The tenor of all pending lawsuits is that Ripple was obliged to register the sale of the XRP token in accordance with the US Securities Act. In addition, the plaintiffs accuse Ripple and CEO Brad Garlinghouse of fraud and deception.

The longest pending class action lawsuit dates back to November 2018 and is being heard in the State of California, led by lead plaintiff Bradley Sostack. In March of this year, the Simmons vs. Ripple Labs Inc. trial began in New York State. However, the trial was transferred to California shortly afterwards.

On August 6, a joint motion was also filed to consolidate the Simmons case with the class action lawsuit led by Sostack. This motion was granted on August 21. Furthermore, the judge responsible has now taken note of Ripple’s motion to dismiss the fraud allegations.

As CNF further reported, on June 8th, Ripple Labs filed a motion to dismiss three of the seven charges, which do not concern the securities issue, but allege Ripple of committing fraud. Ripple’s attorneys stated in the motion to dismiss these charges that lead plaintiff Bradley Sostack cannot prove how Ripple employees and CEO Brad Garlinghouse made fraudulent statements.

According to a document provided to XRPArcade, a decision could soon be made on those very allegations. The judge has taken the fraud allegations under submission, which could mean a timely decision. Specifically, XRPArcade wrote:

While initially August 26 was the next court date in relation to Ripple’s motion, the court has already taken the matter under submission, meaning the Judge will think about the case and reach a decision. If, however, the court decides an oral argument is necessary, both parties will be notified.

While we can not be certain that the Judge will reach a decision, it seems that a decision on Ripple’s motion to dismiss any fraud allegations against it and its executives will soon be made.

Regardless of how the judge of the US State of California might decide soon, the core question whether XRP is a security and whether Ripple would have had to apply for permission to sell the XRP token, will probably not be resolved any time soon.